Item 1: Kevin Hall, CPA and Rosemary Meyer, CPA

The Commission will hear oral argument in an appeal by the Division of Enforcement from the decision of an administrative law judge in a proceeding brought pursuant to Commission Rule of Practice 102(e). The law judge found that the conduct of Kevin Hall, CPA and Rosemary Meyer, CPA, in connection with the fiscal year ("FY") 1999 audit of the financial statements of U.S. Foodservice, Inc. ("USF") and the interim review of USF's second quarter FY 2000 financial statements, was not improper under the Rule.

Among the issues likely to be argued are whether Hall and Meyer failed to exercise due professional care in the planning and performance of the audit, failed to obtain sufficient competent evidential matter to afford a reasonable basis for an opinion regarding the financial statements under audit, and failed to act in accordance with professional standards in connection with the interim review. The parties may also address whether and to what extent Hall and Meyer should be sanctioned if they are found to have engaged in improper professional conduct.

Item 2: Gregory O. Trautman

The Commission will also hear oral argument in an appeal by Gregory O. Trautman from the decision of an administrative law judge. The law judge found that Trautman, co-founder, president, and chief executive officer of Trautman Wasserman & Company, willfully violated Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Exchange Act Rule 10b-5 by engaging in a scheme to defraud mutual funds and their shareholders through late trading and deceptive market timing. The law judge also found that Trautman willfully aided and abetted, and was a cause of, Trautman Wasserman & Company's violations of Exchange Act Section 15(c) and Exchange Act Rule 10b-3, and willfully aided and abetted, and was a cause of, Trautman Wasserman & Company's clearing firm's violations of Rule 22c-1 of the Investment Company Act of 1940. For these violations, the law judge barred Trautman from association with any broker or dealer, prohibited him from serving or acting in various capacities with respect to a registered investment company, imposed a cease-and-desist order, ordered disgorgement of $1,373,799.75, plus prejudgment interest, and assessed a $500,000 third-tier civil money penalty.

Among the issues likely to be argued are whether Trautman's conduct was fraudulent, whether he aided and abetted and/or caused a violation of Investment Company Act Rule 22c-1, whether he aided and abetted and/or caused his firm's violations, and, if so, whether and to what extent sanctions should be imposed on him.

* * *

For further information, please contact the Office of the Secretary at (202) 551-5400.